Internet in India is drawing fair number of eyeballs, interest, conversation and investment.
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Monday, April 19, 2010

Social Networking in India

For the launch of their first store in the up market Select Citywalk mall in Delhi, Haagen Dazs chose the words – ‘Entry restricted to holders of international passports only’. The intent of the company as clarified by them was to ‘get a taste of abroad right here in India’. However, their choice of words was easily misinterpreted as if they did not want to allow Indians in their store! Someone took a photograph of the signage and e-mailed it to a Times of India blogger, who put it on his blog within a couple of hours with the headline saying ‘Sorry, Indians not allowed’. The blog where this was carried has 804 hate comments till now and 2 hate groups on Facebook were spawned having close to 400 members. Thanks to the power of social media the hate Haagen Dazs campaign spread like wildfire not only in India but across the globe, inciting a hail of protests that left the company red-faced and ultimately they were forced to backtrack and issue an apology.

Emergence of Internet has changed the way media is created and consumed. Traditionally media was created by media companies who created the content and were the content owners. The content owners use to ‘broadcast’ this media to the consumers of such content. With internet this equation has undergone a fundamental change, now anyone can create content and share it with others using platforms like Blogging, Social Networks, YouTube etc. There is a term that describes this phenomenon- USG or User Generated Content!

In today’s era the consumers of media themselves have become media creators and the best part is that once such content is created it is getting distributed on the internet through any of the previously mentioned platforms and other users/ consumers engage with this content by commenting, Re-Tweeting etc. The communication on the internet between content and consumers is becoming a 2-way dialogue instead of the earlier 1-way broadcast.
Gaining popularity of social networking has brought in another dimension to this rapidly changing landscape. People are getting more connected & communicative with their networks. Technology allows them to voice their opinions at literally the speed of thought. It is imperative for brands to very carefully manage their ‘image; in this new digital space. Online reputation management becomes an integral part of a well planned Social Media Marketing exercise. The recent fiasco of Haagen Dazs launch in Delhi is a prime example of how fast negative publicity can travel in this new wired world.

This entire fast changing multi dimensional communication system is broadly referred to as SOCIAL MEDIA. It opens new areas and throws new challenges in front of the advertisers; they can either leverage this or get left behind. Conventional wisdom of marketing dictates that a brand should be present where the users are. Hence we see advertisers evaluating media options by the cost per user or cost per eyeball reached and most media is priced on this basis and you have metrics like Viewership (Television Rating Points - TRPs), Readership (IRS- Indian Readership Survey/NRS – National Readership Survey) etc. to measure these.

If we were to use the conventional logic and evaluate how many of the 50 Million Internet users in India who are visiting various online social networking sites, following interesting facts emerge as per Alexa & Vizisense:

In addition to the above, take a look at the ranking in terms of users of UGC sites:

Blogger.com – 6th visited site

You Tube: - 7th

Wordpress: 15th

What the above simply means is that 7 out of top 20 sites Indian internet users are visiting are in the arena of social media. 4 out of top 20 most visited sites in India are social networking sites. I would estimate that more than 70% people who are online are engaging with social media on some or the other platform (site).

One can argue that these are quantitative numbers, what about quality? Advertisers look for certain demographics whilst targeting their communication messages. Hence it is important to also see what kind of people are a part of this social media fraternity. Let us look at the demographics of users of Facebook (source: Vizisense). Almost 50% of Facebook users have income over 2 lacs / annum and more than half of the users are above 24 years of age. 63% users are graduates & above.

Audience demographics of LinkedIn.com - a business networking website is even better. Close to 60% users have an annual income of more than 2 lacs and close to 80% users are graduates and above.

To find more about the usage of Social networking sites, I conducted a survey and the following were key findings:

1. Reasons for usage of internet

Top usage of internet was for communication (email / chat). Almost 96% users use internet for communication purposes.

Almost 85% users stated that they visit social networking sites. This emerged as the second largest reason for using the internet.

This was followed by consumption of news at 61%.

2. Amongst the social networking sites, Facebook emerged as the most popular website with almost 91% users visiting it, followed by Orkut at 61%, LinkedIn at 34% and Twitter at 23%.

3. 35% of the users contacted are students and almost 60% of the users earn more than Rs. 10,000 per month. 22% users claimed to earn more than Rs. 50,000 per month.

4. Usage hours:

Another significant finding from our survey was that 80% users consume Internet for more than 2 hours / day, while only 33% users watched TV for more than 2 hours/day, and none of the users read newspaper for more than 2 hours/day.

Almost 75% newspaper readers read it for less than 1 hour/day. 36% viewers watch TV for less than 2 hour/day. While amongst the Internet users, the percentage of users spending less than 1 hour/day on Internet was only 4%.

The fact that gets clearly established is that the internet users consume Internet far more than any other media! Advertisers need to really note this point. Since to find these users on any media other than internet will become more and more difficult as they increase their internet consumption and reduce consumption of other media. in the western countries already the advertisers are finding it hard to target the under 29 users outside Internet and I feel it is only a matter of time when this will also happen in India.

The results of this survey and the demographic details of social media users, reinforces the point that not only there is a substantial number of users visiting various social media sites but they are also relatively well educated and well to do – exactly the kind of Audience that most of the fashion brands & marketers will want to address.

I would go a step ahead and say that after bollywood and cricket, the only other thing than has the potential of truly binding Indians is social networking!

The important question that would emerge for any advertiser is ‘How do I ‘Participate’ in social media? The tricky part is that rules for engaging with customers on social media platforms are very different. Hence the advertising formats that the advertisers are used to are not really applicable in this new world

There are two ways of being present / to participate in social media. Brands can pay and buy ‘space’ on social media websites. Such buys can be targeted on demographics and keywords. But the second way is more exciting where advertisers can actually leverage the social media to get consumers to endorse the brands to their friends and networks. Such endorsement is far more powerful that a regular advertisement because here rather than the brand saying something about themselves to me, a friend who is in my network is saying nice things about the brand and exhorting me to check it out. I will tend to believe such endorsement more than a brand advertisement. Such endorsement is also referred to as ‘in-stream’ participation/ advertising. For being ‘in-stream’, advertisers have to speak the language of the users, they have to be in constant dialogue with them, and they have to give reasons for the consumers to endorse them instead of tom-tomming about themselves. The advertisers also need to learn how to leverage ‘virality’ the medium allows for spreading their image and proposition

Participation options on various Social media sites:

1. Facebook:

Self-served advertising model on selected inventories. Advertisers can buy some inventories on a Cost-per-Click (CPC) or Cost-per-Mille/ Thousand impressions (CPM) basis. Payment can be made through credit card.

Facebook also has a tie-up with Google wherein advertising is possible through the Google Content Network on a CPC/CPM basis.

Presence through brand page/ fan page. Facebook has an option for brands to create their fan/ brand page. This allows users to become fans of the brand and they can then engage with the brand in various manners. Any ‘post’ made by the advertiser/ brand on this page will go directly into the account of the fans. Using the Fan page application advertisers can send regular updates, promotional messages etc to the fans / followers very easily. It is not difficult for a brand to create a brand/fan page, but what is challenging is to give users compelling reasons to become fans and then also to keep remained engaged with the brand over a period of time. This requires great level of strategic planning & execution. Users can remain engaged over a period of time only due to either compelling content being disseminated by the brand or through contests or through gratification (deals & discounts). For a participation strategy brands must pre plan a complete calendar of user engagement hooks and then embark on the implementation.

Has a tie-up with Google. We can use Google Content network for text advertisements on LinkedIn on a CPC/CPM basis.

LinkedIn also has a self-served advertising model on selected inventories. Advertisers can buy some inventories on a CPC basis. Payment through credit card.

In India LinkedIn have appointed www.NetworkPlay.in as sole concessionaires for representing their inventory where advertisers can buy this inventory on a CPM basis.

Create company page

Create discussion groups.

3. Orkut: It is a Google company. Advertising possible through Google Content Network on a CPC/CPM basis.

4. YouTube: It is also a Google company. Advertising possible through Google Content Network on a CPC/CPM basis. We have also seen companies uploading their TVCs etc on YouTube to gain from the wide distribution and reach that YouTube platform offers.

5. Blogger.com: Though this is a Google company as well, it is difficult to get inventories to advertise on individual blogs as these are owned by various bloggers and they have exclusive rights to the inventory of their own blogs. Can reach them through ad networks including Google content network. Any company can create their own blog on one of the blogging platforms like blogger.com. Care should be taken that a blog is not a replica of a company website; It should revolve around interesting content. For example a Fashion Designer’s / brand’s blog could talk about design trends globally and in India!

6. Twitter:

Offers inventories through two models where the advertiser pays the Twitter users to

Sport the ad on their personal profiles for a pre-decided period of time, so it can be viewed by their “followers” –Twitad. (Payment is for the number of users that agree to publish the ad on their profile/account pages.)

Publish “ad tweets” through their personal profiles – Twivert. (CPC inventory in terms of ad tweets created by the advertiser & sent out by twitter users. An advertiser pays only when the ad tweet is clicked on.)

Allows users to create a company profile which can then be used for promotions in the form of personal tweets.

How to launch & run a successful social media marketing exercise

To launch & run a social media campaign for a brand, it requires skills that span strategic & creative thinking, technology, content creation and content aggregation capabilities. The main problem is that the amalgamation of all these skills is neither available with the advertiser nor with their conventional agency! There are some specialized social media marketing companies that are getting formed in India but they leave a lot to be desired. This could be one of the chief reasons why social media marketing has not taken off in India in a big way till now.

I would like to suggest a 7 point recipe for a successful social media campaign:

It has to be owned by the marketing team of the advertiser as a must do project. (IT or PR department can have a peripheral role at best)

A project manager from the marketing team has to be identified for this task.

Advertiser should hire a specialized social media marketing agency. They will bring perspective on technology & user engagement.

The specialized agency should be made to work closely with the advertiser’s creative agency. They will bring brand understanding to the table.

Advertiser should insist on a proper content team to be deployed by the specialized agency.

Detailed activity plans & budgetary provisions should be made for content, contests & gratification of users.

Advertiser should not be averse to spending media monies to get users to sign up as fans, i.e. advertiser should plan to allocate media monies for promoting their social network destination.

I would like to issue a note of caution here. In the internet world, changes are very rapid, hence to even suggest planning for and making a long term strategy online is futile. At best I would recommend thinking in terms of a maximum period span of six months to a year. User habits & preferences change very rapidly in this new world order. Orkut was a rage before Facebook came in, and the uber-cool users in India quickly migrated to Facebook which had more functionalities, features and was considered to be more happening! Facebook got its formula right from the beginning since it allowed developers, application makers and even brands to plug into its platform. All this made Orkut seem like a poor cousin and now it has lost its sheen amongst lot of urban internet users. Marketers need to be totally clued in to the changing preferences on internet users if they have to leverage the power of not only social media but internet per se.

I did a comparison of Indian Fashion Brands and International Fashion Brands' presence on Social media. Out of the 27 Indian & international fashion and sports brand studied, what was extremely surprising that only 11 had presence on Facebook. What really impressed was that the (international) presence of international brands was truly fantastic with some brands having even more than 2 million fans! The ones that deserve a special mention are – Levis, Reebok women, Adidas & Puma. Indian brands should take a leaf from the way these brands have represented themselves on Facebook. However, at the same time most of these brands haven’t taken care to have local/ India specific presence. I feel that international brands must have robust local presence to leverage the power of social media in specific countries.

It is very surprising that even though the emergence of social media in India has been happening over the past 2-3 years and has now reached a significant proportion, advertisers still consider it more of an upcoming phenomenon. They should wake up and realize the potential this platform provides for engaging users, something that no other media vehicle can give to an advertiser.

__________________________________________________________________________First published in Images Business of Fashion December’09 issue

I liked this content/ article. I would certainly recommend the same to others as well.

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This is really a good insight into the usage pattern of social media sites in India. And it is really interesting to see that Internet has become more popular than TV. But I guess this survey was done among the educated class living in urban areas. If we have to do the same survey in some tier 2 or tier 3 cities than the results would probably slide in favor of TV mainly because of poor or no access to the Internet in those areas.

I love reading your blog. I am a budding entrepreneur in e-commerce space and working on a business plan for some investors based in NYC USA. I am grateful for all the information you have on these blogs. However, I find your web interface very clumsy and slow. I believe if you clean it up, be more organized, and provide a user friendly navigation and interface, you would do complete justice to your efforts and get so many more eyeballs. If you need help, let me know. You can find me at agrawal.ravi.p@gmail.comThanks anyway.Ravi Agrawal

About Me

An MBA from IIM Ahmedabad 1989 batch with work experience across diverse industries. - Internet, Media, FMCG, Office Automation & Stock Broking.
I have successfully set up operations for UK's leading online marketing company - dgm.(www.dgm-india.com). DGM India is one of the leading networks in the Internet space in India.
Prior to this I had a brief stint with India's leading Interactive Agency - Mediaturf in Delhi as EVP & Director.
I have also worked for 4 years with one of India’s largest Internet entity – Indiatimes.com. I was instrumental in creating and heading the “Subscriptions” business. Starting in February 2003 with a single product Indiatimes Meramail, the business today has a very large number of paid users across varied products like Tenders, eTesting etc.